The Tellytrack insert was a one sided win for the operators because Robin Bruss ably assisted the Tellytrack CEO, John Stuart. Its a pity there was no one to represent the other side just for the sake of a level playing field.
Unfortunately Bruss was really a mediator rather than an interviewer so misconception after misconception slid through without a counterbalance, sorry in advance for this long post.
On the issue of turnover, no one to pointed out that while national figures show that both tote and fixed odds industries turn over about 5 billion, that the tote returns only about 78% back to punters and fixed odds operators typically return towards 90% to punters (less the 6%).
Given that it was a Tellytrack production, maybe they are at fault for not ensuring we had an opposing view. No one pointed out while there may be 300 competing bookies, those bookies all operate at risk and competition with individual overheads, that the tote is a monopoly with shared overheads and has the privilege of holding the only profit guaranteed licence to enable so THAT THEY CAN AND MUST PAY for racing! That is WHY they can have a lotto like vehicle, not because they are nice guys! This has a long history.
When the Tote says the bookies pay over the tax on behalf of winning punters, where does the tote think it gets it's 25% cut of turnover? Everything comes from punters, before (tote) and after (bookies). Happily we punters still get to choose the WHO and HOW we want to lose our money and contribute. Long may it last too.
It’s a laugh that Phumelela see themselves as a player. Their tote licence only exists in its monopolistic form to contribute funds for racing (and provide gambling taxes), and that a listed company got its hands on it only means the national tote contributes less to racing than it would have because it must pay dividends to its shareholders. How are those shareholders any more or less than a bookmaker profiting from a bet, I don't know except they can't lose.
John Stuart says bookmakers don’t pay for overseas racing while the tote does. Well if the tote does pay 3% of turnover, then of the 6% collection of bookmakers/punters tax by the government half is returned to the operators. The local operators have nothing to do with the Bookmakers returns on overseas racing so let’s hope they paid their overseas partners with all the cash they collected on betting from racing outside SA.
Has Tellytrack even shown that their proposed tax on viewers and vendors will go to racing and not to the company profits and to dividends? I mean a tax is for the greater good. Phumelela is the majority owner in Tellytrack so is it a reasonable question to ask should a listed company even be able to tax “competitors” for their own profit?
CEO John Stuart seems blissfully unaware that Tellytrack in its current incarnation was started in SA as an operation that was just an expense. There was no concept of making a profit; everyone who subscribed in the beginning knew they were paying to cover the costs!
IGN was expensive for me, I just hoped as more people subscribed that it would get more affordable. And it did, in the end operators and bookmakers paid and we punters got it free (well, we played more and so lost more; "free" is how you look at it). As a result, most participants in SA racing "feel" that Tellytrack is "ours". I thought it was common knowledge that 300 bookies paying 5K a month is about 1.5 million a month which was a fair share of the Tellytrack costs with the operators.
It is no surprise to me that the bookmakers feel aggrieved. After decades of co-funding the picture with the operators who now say they earn "R7 out of R8" of their R110 million profit from our picture going overseas. Now their earlier partners now want to "profit" from every side of the buttered bread. Phumelela feigns incredulity when the bookmakers say that we were crucial contributors to help make TV racing broadcast possible in SA, and now that "we" can make money from overseas, why can't we keep Tellytrack at a cost + for the local industry? It’s not an unreasonable position. I still feel it’s “our” intellectual property as South African racers, not Phumelela. It belongs to breeders, punters, bookmakers, trainers, sponsors, the game at large, not Phumelela shareholders.
Mr Thurling pointed out that Cricket makes its money from selling the TV picture. Bruss said it was a pity that SABC didn't take the Met (presumably for free). Is it an irony that that escapes Thurling? He also thought another channel would be nice for the non punting racing fans who don't like overseas clutter. Did anyone not tell him 75% of Tellytrack broadcast is from overseas, and that it's people who do bet that pay for the show?
Nairac is a beaut too. He says all the bookmakers in KZN agreed (not Hollywood). What he doesn't say is that for this month GC subsidized all the bookmakers with half a million from their pockets (not Hollywood). And as co owner of Tellytrack, they partly paying themselves so it's probably not the full 500k effect on the bottom line.
Of course the biggest clanger here is the elephant in the room. One hoped that Bruss or even Thurling who understands the bookmaking game would point it out. The issue is probably that 3% of turnover on a bookmakers business model is much, much more onerous that 3% on a "profit only" tote model with its 22% + take out. If the tote pays 3% of t/over: 3% of 22%, about 13% of the take. The national figures show that bookmakers return much more to punters, so 3% of 10% is closer to 30%. How is it possible that none of them said the problem is that the 3% of t/over means completely different things depending on whether you have a tote or a fixed price model. Seriously, how does an “educational” insert miss the main issue?
One last thing, while everyone clamours for their cut: Tellytrack, subsidized stables, whatever, it all, all, comes from the punters who lose about R800,000,000 to the tote and about R400,000,000 million to bookmakers. The whole game runs on the billion plus we lose every year. Not once have we heard about the great service Tellytrack gives to the SA viewer instead of how we must come to the overseas party, or the great service the betting industry gives to the punter instead of the money always taking care of stakes while the punters sit in crappy totes.
At the end somehow WE will all lose to pay for Tellytracks cash injection so they can move from loss-leader to cash cow. Again Tellytrack wants local racing to build and pay for the machine here that makes their top end profit from overseas for shareholders. We can only hope if they muscle their way accross this line that some government agency puts the squeeze on the new tax collector in town so that the industry benefits, not the Tellytrack shareholders.
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